in the final exam 1 simulaion 2 there is a reporting tab .. it says

AS the service cost intrest cost increases the PBO increases and hence the funded status decreases...

soo is this general rule OR its depend the the fundded status is over funded or underfunded on that

assume the PBO is 600000 and  F.V assest is  620000

soo if the service cost is 30000

it increases the PBO by 30000 and decreases the funded status of overfunded 20000 non current asset . rt?????

but if suppose it was the opposite case of PBO with 6200000 and the F.V with 600000 than what would be the effect .. definately it will increase the PBO but what with the funded status.... will it INCREASE OR DECREASE..........

sumone pls help me... i m not able to understand the diifernec between that increase and decrease fundaaaaaaaa

not sure, but may be few threads in the following topic may help you understand the funded status :-

http://www.cpanet.com/cpa_forum/forum_posts.asp?TID=22055&am p;am p;am p;KW=pension&PN=0&TPN=1

PBO is a liability ! current year's service cost and interest cost increases our projected benefit obligation....

Do go through pages F6-11 and F6-12 in Becker which explains very well about the funded status - Pension Plan asset vs Pension Plan liability.

In case, you still face issues, do let know !

I am not sure I understand your question though. I am reviewing F6 right now:

Think of a funded status as an investment that you have. If you owe to the bank (employees) more than what the FV of your investments are then you are UNDERfunded, if your investment's FV is more than what you owe then you are fine, you are OVERfunded. UNDER=liability, OVER=asset.

The service cost is the PV of all benefits earned by employee (you owe them) the serv cost will increase your PBO or liabilities.   In English:  if you have to pay more (service cost increased) than what you have in your investments (PV of Pension plann assets) then your funded status will decreased... you will need more $$ (assets plan to pay your liabilities or PBO). 

The interest cost in the other hand will Increase your debt because you are accruing interest on money you owe.

Read F-6 pag 6.  Interest cost ALWAYS increases PBO because the PV of any liability increases as you get closer to the due date.

Also current and non-current depends on whether you own the $$ right away (12 months) or (non-current beyong 12 months)

I found it is easier to think of this as money that you have to pay in the future and both (the money; asset plan) and the debt (PBO) is subjet to change by rates, expected return, g/loss etc.

If this confuse you more pls. disregard.  It late 1:36am.